Low-grade coal (low-quality coal) such as brown coal and subbituminous coal with high moisture content has a low calorific value per unit weight. Accordingly, the low-grade coal is dried and pyrolyzed by being heated, and is also upgraded in a low-oxygen atmosphere so as to reduce its oxidation reactivity, thereby being transformed into upgraded coal with an improved calorific value per unit weight while being prevented from being spontaneously ignited.